California Coastal Communities Inc., the developer of the shore-view homes overlooking the Bolsa Chica wetlands, said in its latest earnings report today it expects the housing downturn to continue “throughout the remainder of 2008 and into 2009.”

The forecast comes amid mixed news. On the one hand, the Irvine-based company continues to slash prices for homes it’s building in Lancaster and the Inland Empire, according to a company press release. It’s available supply of cash has dwindled to $1.2 million during the first three months of the year, down from $24.3 million in the same quarter of 2007.

But nine homes in the company’s Brightwater project in Huntington Beach’s Bolsa Chica preserve (see photo) went into escrow in March with an average sales price of $1.8 million. The company maintains it has low carrying costs for the project and expects profit margins of 30% to 40% on those homes once the market turns around. But that turnaround remains elusive:

“The results for the first quarter of 2008 continue to reflect the continued weakness in the housing market, which has been compounded by difficulties in the mortgage lending industry prompted by the collapse of the subprime lending market that have resulted in more stringent lending standards, higher interest rates on jumbo mortgages and tightening of credit available to many homebuyers. Further, potential homebuyers are more cautious about purchasing a home due to uncertainty about the future direction of home prices, their ability to sell existing homes, and the appearance of an economic recession. In view of present circumstances, the Company expects the real estate market downturn to continue throughout the remainder of 2008 and into 2009.”

Net loss totaled $700,000 in the first quarter this year, compared to a $3 million loss in the same quarter a year ago. The reduction in red ink is due primarily to the absence of “impairments” on assets whose value has shrunk because of the slump.

For more than a decade, Jeff Collins has followed housing and real estate, covering market booms and busts and all aspects of the real estate industry. He has been tracking rents and home prices, and has explored solutions to critical problems such as Southern California’s housing shortage and affordability crisis. Before joining the Orange County Register in 1990, he covered a wide range of topics for daily newspapers in Kansas, El Paso and Dallas. A Southern California native, he studied at UC Santa Barbara and UC Irvine. He later earned a master’s degree from the USC School of Journalism.

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